Title:
A Stock Market Big Enough to Stretch Across the
Atlantic
Description: This is
a VOA Special English Economics Report.
See text below
Text:
A ten-billion-dollar deal aims to create the world's
largest exchange company. The plan would combine the
operators of the New York Stock Exchange and
Germany's Frankfurt Stock Exchange.The two
companies, NYSE Euronext and Deutsche Borse,
announced the agreement in February. Deutsche Borse
shareholders would own about sixty percent of the
combined group. One thing it still needs is a name.
The new company would have headquarters in Frankfurt
and New York City. The New York Stock Exchange is
the world's most famous stock market and a symbol of
American capitalism. Treasury Secretary Tim Geithner
says New York will remain at the heart of the
world's financial system for a long time to come.
But the exchange business has changed in these days
of high-speed trading by computers in a globally
connected economy. The Big Board now has to compete
with smaller exchanges. Where stocks are traded has
become less important than how much those trades
cost.NYSE Euronext and Deutsche Borse had profits of
almost four and a half billion dollars last year.
They expect to save four hundred million dollars a
year by combining their operations. These savings
could lower the cost of stock orders. But the size
of the company could raise concerns about
competition in the exchange industry. The new
company would also have trading operations in
Britain, France and other European countries.Stock
trading and other financial services would remain
important to the combined company. But much of its
income is expected to come from trading complex
financial products called derivatives. The deal
requires approval by American and European officials
and by shareholders. Other exchange operators, like
the CME Group, could try to offer a higher price for
NYSE Euronext. The CME Group, operator of the
Chicago Mercantile Exchange, is one of the world's
largest traders of derivatives. Duncan Niederauer,
chief executive of NYSE Euronext, is expected to
keep that job in the new company. He says combining
with Deutsche Borse will make the company more
competitive. In February, the operators of the
London and Toronto stock exchanges announced a deal
to combine their companies. And in October the
Singapore Exchange offered to merge with Australia's
exchange.For VOA Special English I'm Alex
Villarreal.
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Hi. I
personally reviewed this video and found it appropriate for
the news section of English Global Group. This
is a Voice of America video which covers an interesting
topic in Special English. I would appreciate some feedback from both
students and teachers about this video. You can comment in
the window below using any of a number of different services
including Facebook, Yahoo, AOL, and Hotmail.
